By Siebert, et al. H.B. No. 3092
76R11360 GJH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the powers and duties of the Motor Vehicle Board of the
1-3 Texas Department of Transportation; imposing a penalty.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 1.03(3), (14), (18), (19), (21), and
1-6 (33), Texas Motor Vehicle Commission Code (Article 4413(36),
1-7 Vernon's Texas Civil Statutes), are amended to read as follows:
1-8 (3) "Broker" means a person who, for a fee,
1-9 commission, or other valuable consideration, arranges or offers to
1-10 arrange a transaction involving the sale[, for purposes other than
1-11 resale,] of a new motor vehicle, and who is not:
1-12 (A) a franchised dealer or bona fide employee of
1-13 a franchised dealer when acting on behalf of a franchised dealer;
1-14 (B) a representative or bona fide employee of a
1-15 representative when acting on behalf of a representative;
1-16 (C) a distributor or bona fide employee of a
1-17 distributor when acting on behalf of a distributor; or
1-18 (D) at any point in the transaction the bona
1-19 fide owner of the vehicle involved in the transaction.
1-20 (14) "Franchise" means one or more contracts between a
1-21 [franchised dealer as] franchisee[,] and [either] a manufacturer or
1-22 a distributor as franchisor under which (A) the franchisee is
1-23 granted the right to sell and service new motor vehicles
1-24 manufactured or distributed by the franchisor or only service motor
2-1 vehicles pursuant to the terms of a franchise and a manufacturer's
2-2 warranty; (B) the franchisee as an independent business is a
2-3 component of franchisor's distribution system; (C) the franchisee
2-4 is substantially associated with franchisor's trademark, tradename
2-5 and commercial symbol; (D) the franchisee's business is
2-6 substantially reliant on franchisor for a continued supply of motor
2-7 vehicles, parts, and accessories for the conduct of its business;
2-8 or (E) any right, duty, or obligation granted or imposed by this
2-9 Act is affected. The term includes a written communication from a
2-10 franchisor to a franchisee by which a duty is imposed on the
2-11 franchisee.
2-12 (18) "Lease facilitator" means a person, other than a
2-13 franchised dealer or a bona fide employee of a dealer, or a vehicle
2-14 lessor or a bona fide employee of a vehicle lessor, who:
2-15 (A) holds himself out to any person as a "motor
2-16 vehicle leasing company" or "motor vehicle leasing agent" or uses a
2-17 similar title, for the purpose of soliciting or procuring a person
2-18 to enter into a contract or agreement to become the lessee of a
2-19 vehicle that is not, and will not be, titled in the name of and
2-20 registered to the lease facilitator; or
2-21 (B) otherwise solicits a person to enter into a
2-22 contract or agreement to become a lessee of a vehicle that is not,
2-23 and will not be, titled in the name of and registered to the lease
2-24 facilitator, or who is otherwise engaged in the business of
2-25 securing lessees or prospective lessees of motor vehicles that are
2-26 not, and will not be, titled in the name of and registered to the
2-27 facilitator.
3-1 (19) "Lessor" means a person who holds [acquires]
3-2 title to a motor vehicle and who transfers to another person under
3-3 the terms of a lease agreement the right to possess and use the
3-4 motor vehicle [for the purpose of leasing the vehicle to another
3-5 person].
3-6 (21) "Manufacturer" means any person who manufactures
3-7 or assembles new motor vehicles [either within or without this
3-8 State].
3-9 (33) "Rule" means a statement by the board
3-10 [Commission] of general and future applicability that implements,
3-11 interprets, or prescribes law or policy or describes the
3-12 organization or procedural practice requirements of the board
3-13 [Commission]. The term includes the amendment or repeal of a prior
3-14 rule, but does not include statements concerning only the internal
3-15 management of the board [Commission] which do not affect the rights
3-16 of a person not connected with the board [Commission].
3-17 SECTION 2. Section 1.03(28), Texas Motor Vehicle Commission
3-18 Code (Article 4413(36), Vernon's Texas Civil Statutes), as
3-19 renumbered by Chapter 639, Acts of the 75th Legislature, Regular
3-20 Session, 1997, is amended to read as follows:
3-21 (28) "Party" means each person or agency named or
3-22 admitted as a party and whose legal rights, duties, or privileges
3-23 are to be determined by the board [Commission] after an opportunity
3-24 for adjudicative hearing.
3-25 SECTION 3. Section 1.03(28), Texas Motor Vehicle Commission
3-26 Code (Article 4413(36), Vernon's Texas Civil Statutes), as added by
3-27 Chapter 779, Acts of the 75th Legislature, Regular Session, 1997,
4-1 is amended and redesignated to read as follows:
4-2 (36) [(28)] "Towable recreational vehicle" means a
4-3 nonmotorized vehicle that is originally designed and [originally]
4-4 manufactured for the primary purpose of providing temporary human
4-5 habitation [as its primary purpose] for recreational, camping, or
4-6 seasonal use and:
4-7 (A) is titled and registered with the Texas
4-8 Department of Transportation as a travel trailer through the county
4-9 tax assessor-collector;
4-10 (B) is permanently built on a single chassis;
4-11 (C) contains one or more life support systems;
4-12 and
4-13 (D) is designed to be towable by another motor
4-14 vehicle.
4-15 SECTION 4. Section 2.02, Texas Motor Vehicle Commission Code
4-16 (Article 4413(36), Vernon's Texas Civil Statutes), is amended by
4-17 amending Subsection (c) and adding Subsection (d) to read as
4-18 follows:
4-19 (c) The membership of the board includes:
4-20 (1) two persons who are dealers licensed pursuant to
4-21 the terms of this Act or who have at least a 20 percent ownership
4-22 interest in a dealer, at least one of whom must be a franchised
4-23 dealer or have at least a 20 percent ownership interest in a
4-24 franchised dealer; and
4-25 (2) one representative of a motor vehicle manufacturer
4-26 or distributor licensed pursuant to the terms of this Act.
4-27 (d) A person is not eligible to serve on the board under
5-1 Subsection (c)(1) of this section if the person's qualifying
5-2 ownership interest under Subsection (c)(1) of this section is in a
5-3 dealer in which a manufacturer or distributor has an ownership
5-4 interest.
5-5 SECTION 5. Sections 2.08(a), (b), and (c), Texas Motor
5-6 Vehicle Commission Code (Article 4413(36), Vernon's Texas Civil
5-7 Statutes), are amended to read as follows:
5-8 (a) The Governor shall designate one member of the board,
5-9 other than a member appointed pursuant to the terms of Section
5-10 2.02(c) of this Act, as Chairman to serve in that capacity at the
5-11 pleasure of the Governor. The board shall hold a regular annual
5-12 meeting in September of each year and elect a Vice-chairman to
5-13 serve for the ensuing year. The board shall have regular meetings
5-14 as the majority of the members may specify and special meetings at
5-15 the request of the Chairman, any two members, or the Director.
5-16 Reasonable notice of all meetings shall be given as board rules
5-17 prescribe. A majority of the board constitutes a quorum to
5-18 transact business[, except that a member appointed under Section
5-19 2.02 of this Act is not counted in the calculation of a quorum for
5-20 purposes of the determination of an issue with respect to which the
5-21 member is prohibited from voting]. The Chairman, or in his
5-22 absence, the Vice-chairman, shall preside at all meetings of the
5-23 board. In the absence of both the Chairman and the Vice-chairman,
5-24 the members present shall select one of their number to serve as
5-25 chairman for the meeting.
5-26 (b) The board [Commission] is subject to Chapters 551 and
5-27 2001, Government Code.
6-1 (c) The board [Commission] shall develop and implement
6-2 policies that provide the public with a reasonable opportunity to
6-3 appear before the board [Commission] and to speak on any issue
6-4 under the jurisdiction of the board [Commission].
6-5 SECTION 6. Section 2.08A(c), Texas Motor Vehicle Commission
6-6 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
6-7 to read as follows:
6-8 (c) If the Director has knowledge that a potential ground
6-9 for removal exists, the Director shall notify the Chairman of the
6-10 board [Commission] of the ground. The Chairman shall then notify
6-11 the Governor and the Attorney General that a potential ground for
6-12 removal exists. If the potential ground for removal relates to the
6-13 Chairman of the board [Commission], the [Executive] Director shall
6-14 notify the Vice-chairman of the board [Commission], who shall
6-15 notify the Governor and the Attorney General that a potential
6-16 ground for removal exists.
6-17 SECTION 7. Section 3.02, Texas Motor Vehicle Commission Code
6-18 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
6-19 read as follows:
6-20 Sec. 3.02. DUTIES. (a) The board [Commission] shall, in
6-21 accordance with this Act, administer the provisions of this Act,
6-22 establish the qualifications of licensees, ensure that the
6-23 distribution, sale, and leasing of motor vehicles is conducted as
6-24 provided herein and under the board's [Commission's] rules, provide
6-25 for compliance with warranties, and otherwise prevent fraud, unfair
6-26 practices, discriminations, impositions, and other abuses in
6-27 connection with the distribution and sale of motor vehicles.
7-1 (b) The board [Commission] shall prepare and maintain a
7-2 written plan that describes how a person who does not speak English
7-3 or who has a physical, mental, or developmental disability can be
7-4 provided reasonable access to the board [Commission's] programs.
7-5 SECTION 8. Section 3.08(g), Texas Motor Vehicle Commission
7-6 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
7-7 to read as follows:
7-8 (g) In all contested cases the examiner shall serve on all
7-9 parties a copy of the examiner's proposal for decision and
7-10 recommended order containing findings of fact and conclusions of
7-11 law. A party may file exceptions and replies to the board. In its
7-12 review of the case, the board may consider only the materials
7-13 timely submitted. The board may receive such oral argument from any
7-14 party as the board may allow. The board shall take such further
7-15 actions as are conducive to the issuance of a final order and shall
7-16 thereafter issue a written final decision or order. The board's
7-17 written final decision or order shall be signed on behalf of the
7-18 board by the chairman or vice chairman [Director]. A majority vote
7-19 of a quorum of the board shall be required to adopt final decisions
7-20 or orders of the board.
7-21 SECTION 9. Section 4.02, Texas Motor Vehicle Commission Code
7-22 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
7-23 read as follows:
7-24 Sec. 4.02. DEALER APPLICATION. (a) An application for a
7-25 dealer license shall be on a form prescribed by the board which
7-26 shall include the information required by Chapter 503,
7-27 Transportation Code, and information on the applicant's financial
8-1 resources, business integrity, business ability and experience,
8-2 franchise agreement if applicable, physical facilities, vehicle
8-3 inventory, and other factors the board considers necessary to
8-4 determine an applicant's qualifications to adequately serve the
8-5 [motoring] public.
8-6 (b) A dealer shall renew his license annually on an
8-7 application prescribed by the board [Commission]. If a material
8-8 change occurs in the information included in a dealer's application
8-9 for a license or renewal of a license, the dealer shall, within a
8-10 reasonable time but not later than the next annual renewal, notify
8-11 the board [Commission] of those changes. The board [Commission]
8-12 shall prescribe a form for the disclosure of the changes and shall
8-13 include in the renewal application a request for disclosure of
8-14 material changes.
8-15 (c) [(1)] A franchised dealer may carry on the business of
8-16 his dealership at more than one location; however, a separate
8-17 location for the display and sale of new motor vehicles may not be
8-18 established and maintained by a franchised dealer unless expressly
8-19 authorized by the franchised dealer's franchise and license. An
8-20 application for a franchised dealer's license or to amend a
8-21 franchised dealer's license which proposes the establishment of a
8-22 separate display and sales location is subject to all of the
8-23 provisions of this Act. A separate license shall be required for
8-24 each separate and distinct dealership as determined by the board
8-25 [Commission].
8-26 (d) [(2)] Except as provided in this subsection
8-27 [subdivision], no licensee may participate in a new motor vehicle
9-1 show or exhibition unless the board [Commission] has first had
9-2 written notice at least 30 days prior to the opening day of the
9-3 show or exhibition and its written approval has been granted. A
9-4 licensee may not sell or offer for sale a new motor vehicle at a
9-5 show or exhibition; however, dealership personnel may be present
9-6 to aid in the showing or exhibiting of new motor vehicles. This
9-7 subsection [subdivision] does not prohibit the sale of a towable
9-8 recreational vehicle, motor home, ambulance, or fire-fighting
9-9 vehicle at a show or exhibition if the show or exhibition is
9-10 approved by the board [Commission] and if the sale does not
9-11 otherwise violate a provision of law. If the board adopts[;
9-12 provided that, should the Commission adopt] a rule regulating
9-13 off-site display or sale of towable recreational vehicles, the
9-14 board [Commission] shall authorize, in the rule, the display and
9-15 sale of towable recreational vehicles at a private event [events]
9-16 in a trade area that would not otherwise qualify as a private event
9-17 under the [areas (counties, cities, or towns) where] application of
9-18 general participation requirements for organized dealer shows and
9-19 exhibitions [would effectively preclude such an organized show or
9-20 exhibition].
9-21 (e) [(3)] The board [Commission] shall, under its general
9-22 rule-making authority granted in this Act, establish rules and
9-23 guidelines for the implementation and enforcement of this section
9-24 [subsection].
9-25 (f) [(d)] A dealer licensed hereunder shall promptly notify
9-26 the board [Commission] of any proposed change in its ownership,
9-27 location, franchise, or any other matters the board [Commission]
10-1 may require by rule. Prior to a change in a dealer's location, a
10-2 dealer shall obtain a new license for that location.
10-3 SECTION 10. Section 4.03(b), Texas Motor Vehicle Commission
10-4 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
10-5 to read as follows:
10-6 (b) An applicant for a manufacturer's license shall furnish
10-7 a list of all distributors, representatives acting for applicant,
10-8 and all dealers franchised to sell the applicant's products in this
10-9 State and their respective locations. An applicant shall list
10-10 separately each dealer in this state in which the applicant, or an
10-11 entity owned or controlled by the applicant, directly or indirectly
10-12 has an ownership interest, regardless of whether the dealer is
10-13 included in the list of franchised dealers. All applicants for
10-14 manufacturer's licenses and all licensed manufacturers shall
10-15 thereafter advise the board [Commission] within 15 days of any
10-16 change in their list of distributors, representatives, and
10-17 franchised dealers. This information shall become part of the
10-18 application.
10-19 SECTION 11. Section 5.01B(a), Texas Motor Vehicle Commission
10-20 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
10-21 to read as follows:
10-22 (a) In order to transfer, assign, or sell a franchise
10-23 agreement or controlling interest in the dealership to another
10-24 person, a dealer shall notify the manufacturer or distributor whose
10-25 vehicles the dealer is franchised to sell of the dealer's decision
10-26 to transfer, assign, or sell the dealership. The notification
10-27 required by this subsection must be by certified mail, return
11-1 receipt requested, and is the application by the dealer for
11-2 approval by the manufacturer or distributor of the transfer. The
11-3 notice must be in writing and must include:
11-4 (1) the prospective transferee's name, address,
11-5 financial qualifications, and business experience;
11-6 (2) a copy of pertinent agreements regarding the
11-7 proposed transfer, assignment, or sale;
11-8 (3) completed application forms and related
11-9 information generally utilized by the manufacturer or distributor
11-10 in reviewing prospective dealers, if the forms are on file with the
11-11 board; [and]
11-12 (4) the prospective transferee's written agreement to
11-13 comply with the terms of the franchise agreement to the extent that
11-14 the franchise agreement is not in conflict with the terms of this
11-15 Act; and
11-16 (5) a statement by the prospective transferee
11-17 identifying any manufacturer or distributor that has an ownership
11-18 interest in the transferee.
11-19 SECTION 12. Section 5.02(b), Texas Motor Vehicle Commission
11-20 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
11-21 to read as follows:
11-22 (b) It is unlawful for any manufacturer, distributor, or
11-23 representative to:
11-24 (1) Require or attempt to require any dealer to order,
11-25 accept delivery of or pay anything of value, directly or
11-26 indirectly, for any motor vehicle, appliance, part, accessory or
11-27 any other commodity unless voluntarily ordered or contracted for by
12-1 such dealer.
12-2 (2) Refuse or fail to deliver, in reasonable
12-3 quantities and within a reasonable time, to a dealer having a
12-4 franchise agreement for the retail sale of any motor vehicles sold
12-5 or distributed by such manufacturer, distributor, or
12-6 representative, any new motor vehicle or parts or accessories to
12-7 new motor vehicles as are covered by such franchise if such
12-8 vehicle, parts or accessories are publicly advertised as being
12-9 available for delivery or are actually being delivered; provided,
12-10 however, this provision is not violated if such failure is caused
12-11 by acts of God, work stoppage or delays due to strikes or labor
12-12 disputes, freight embargoes or other causes beyond the control of
12-13 the manufacturer, distributor, or representative.
12-14 (3) Notwithstanding the terms of any franchise
12-15 agreement:
12-16 (A) Terminate or refuse to continue any
12-17 franchise with a dealer or directly or indirectly force or attempt
12-18 to force a dealer to relocate or discontinue a line-make or parts
12-19 or products related to that line-make unless all of the following
12-20 conditions are met:
12-21 (i) the dealer and the board have received
12-22 written notice by registered or certified mail from the
12-23 manufacturer, distributor, or representative not less than 60 days
12-24 before the effective date of termination or noncontinuance setting
12-25 forth the specific grounds for termination or noncontinuance; and
12-26 (ii) the written notice contains on the
12-27 first page thereof a conspicuous statement which reads as follows:
13-1 "NOTICE TO DEALER: YOU MAY BE ENTITLED TO FILE A PROTEST WITH THE
13-2 TEXAS MOTOR VEHICLE BOARD IN AUSTIN, TEXAS, AND HAVE A HEARING IN
13-3 WHICH YOU MAY PROTEST THE PROPOSED TERMINATION OR NONCONTINUANCE OF
13-4 YOUR FRANCHISE UNDER THE TERMS OF THE TEXAS MOTOR VEHICLE
13-5 COMMISSION CODE IF YOU OPPOSE THIS ACTION."; and
13-6 (iii) the manufacturer, distributor, or
13-7 representative has received the informed, written consent of the
13-8 affected dealer or the appropriate period for the affected dealer
13-9 to protest the proposed franchise termination or noncontinuance has
13-10 lapsed; or
13-11 (iv) if the affected dealer files a
13-12 protest with the board within the greater of (1) 60 days after
13-13 receiving its 60-day notice of proposed termination or
13-14 noncontinuance or (2) the time specified in such notice, the board
13-15 determines that the party seeking to terminate or not continue a
13-16 dealer's franchise has established by a preponderance of the
13-17 evidence, at a hearing called by the board, that there is good
13-18 cause for the proposed termination or noncontinuance.
13-19 (v) Notwithstanding Subdivisions (3)(A)(i)
13-20 and (3)(A)(iv) of this section, notice may be made not less than 15
13-21 days prior to the effective date of termination or noncontinuance
13-22 if a licensed dealer fails to conduct its customary sales and
13-23 service operations during its customary business hours for seven
13-24 consecutive business days unless such failure is caused by an act
13-25 of God, work stoppage or delays due to strikes or labor disputes,
13-26 an order of the board, or other causes beyond the control of the
13-27 dealer.
14-1 (B) Whenever a dealer files a timely protest to
14-2 a proposed franchise termination or noncontinuance, the board shall
14-3 notify the party seeking to terminate or to not continue the
14-4 protesting dealer's franchise that a timely protest has been filed,
14-5 that a hearing is required in accordance with this Act, and that
14-6 the party who gave the dealer notice of termination or
14-7 noncontinuance of the franchise may not terminate or refuse to
14-8 continue the franchise until the board issues its final decision or
14-9 order.
14-10 (C) If a franchise is terminated or not
14-11 continued, another franchise in the same line-make will be
14-12 established within a reasonable time unless it is shown to the
14-13 board by a preponderance of the evidence that the community or
14-14 trade area cannot reasonably support such a dealership. If this
14-15 showing is made, no dealer license shall be thereafter issued in
14-16 the same area unless a change in circumstances is established.
14-17 (4) Notwithstanding the terms of any franchise
14-18 agreement, modify or replace a franchise if the modification or
14-19 replacement would adversely affect, to a substantial degree, the
14-20 dealer's sales, investment, or obligations to provide service to
14-21 the public, unless the manufacturer, distributor, or representative
14-22 has first given the board and each affected dealer written notice
14-23 by registered or certified mail of any such action 60 days in
14-24 advance of the modification or replacement. The written notice
14-25 shall contain on the first page thereof a conspicuous statement
14-26 which reads as follows: "NOTICE TO DEALER: YOU MAY BE ENTITLED TO
14-27 FILE A PROTEST WITH THE TEXAS MOTOR VEHICLE BOARD IN AUSTIN, TEXAS,
15-1 AND HAVE A HEARING IN WHICH YOU MAY PROTEST THE PROPOSED
15-2 MODIFICATION OR REPLACEMENT OF YOUR FRANCHISE UNDER THE TERMS OF
15-3 THE TEXAS MOTOR VEHICLE COMMISSION CODE IF YOU OPPOSE THIS ACTION."
15-4 Within the greater of (1) 60 days after receipt of such notice or
15-5 (2) the time specified in such notice, a dealer may file a protest
15-6 with the board and the modification or replacement shall not become
15-7 effective unless and until the board determines that the party
15-8 seeking to modify or replace a franchise has demonstrated by a
15-9 preponderance of the evidence that there is good cause for the
15-10 modification or replacement. The prior franchise shall continue in
15-11 effect until the protest is resolved by the board.
15-12 (5) Notwithstanding the terms of any franchise
15-13 agreement, in determining whether good cause has been established
15-14 for modifying, replacing, terminating, or refusing to continue a
15-15 franchise, or for forcing or attempting to force a dealer to
15-16 relocate or discontinue a line-make or parts or products related to
15-17 that line-make, the board shall consider all the existing
15-18 circumstances including, without limitation by the enumeration
15-19 herein, all the following:
15-20 (A) the dealer's sales in relation to the sales
15-21 in the market;
15-22 (B) the dealer's investment and obligations;
15-23 (C) injury to the public welfare;
15-24 (D) the adequacy of the dealer's service
15-25 facilities, equipment, parts, and personnel in relation to those of
15-26 other dealers of new motor vehicles of the same line-make;
15-27 (E) whether warranties are being honored by the
16-1 dealer;
16-2 (F) the parties' compliance with their franchise
16-3 agreement except to the extent that the franchise agreement is in
16-4 conflict with this Act; and
16-5 (G) the enforceability of the franchise
16-6 agreement from a public policy standpoint, including, without
16-7 limitation, issues of the reasonableness of the franchise
16-8 agreement's terms, oppression, adhesion, and the relative
16-9 bargaining power of the parties.
16-10 Good cause shall not be shown solely by the desire of a
16-11 manufacturer, distributor, or representative for market
16-12 penetration.
16-13 (6) Use any false, deceptive or misleading
16-14 advertising.
16-15 (7) Notwithstanding the terms of any franchise
16-16 agreement, prevent any dealer from reasonably changing the capital
16-17 structure of his dealership or the means by or through which he
16-18 finances the operation thereof, provided that the dealer meets
16-19 reasonable capital requirements.
16-20 (8) Notwithstanding the terms of any franchise
16-21 agreement, fail to give effect to or attempt to prevent any sale or
16-22 transfer of a dealer, dealership or franchise or interest therein
16-23 or management thereof except as provided by Section 5.01B.
16-24 (9) Notwithstanding the terms of any franchise
16-25 agreement, require or attempt to require that a dealer assign to or
16-26 act as an agent for any manufacturer, distributor or representative
16-27 in the securing of promissory notes and security agreements given
17-1 in connection with the sale or purchase of new motor vehicles or
17-2 the securing of policies of insurance on or having to do with the
17-3 operation of vehicles sold.
17-4 (10) Notwithstanding the terms of any franchise
17-5 agreement, fail or refuse, after complaint and hearing, to perform
17-6 the obligations placed on the manufacturer in connection with the
17-7 delivery, preparation and warranty of a new motor vehicle as
17-8 provided in the manufacturer's warranty, preparation, and delivery
17-9 agreements on file with the board.
17-10 (11) Notwithstanding the terms of any franchise
17-11 agreement[, fail to compensate its dealers for the work and
17-12 services they are required to perform in connection with the
17-13 dealer's delivery and preparation obligations according to the
17-14 agreements on file with the board which must be found by the board
17-15 to be reasonable, or fail to adequately and fairly compensate its
17-16 dealers for labor, parts and other expenses incurred by such dealer
17-17 to perform under and comply with a manufacturer's or a
17-18 distributor's warranty agreement, or require, as a prerequisite to
17-19 the manufacturer's or distributor's payment of a claim for
17-20 reimbursement as required by this section, that a dealer file with
17-21 the manufacturer or distributor the actual time spent in the
17-22 performance of labor unless actual time is the basis for
17-23 reimbursement. In no event shall any manufacturer or distributor
17-24 pay its dealers an amount of money for warranty work that is less
17-25 than that charged by the dealer to the retail customers of the
17-26 dealer for nonwarranty work of like kind. All claims made by
17-27 dealers for compensation for delivery, preparation, and warranty
18-1 work shall be paid within 30 days after approval and shall be
18-2 approved or disapproved within 30 days after receipt. When any
18-3 claim is disapproved, the dealer shall be notified in writing of
18-4 the grounds for disapproval. No claim which has been approved and
18-5 paid may be charged back to the dealer unless it can be shown that
18-6 the claim was false or fraudulent, that the repairs were not
18-7 properly made or were unnecessary to correct the defective
18-8 condition, or that the dealer failed to reasonably substantiate the
18-9 claim in accordance with reasonable written requirements of the
18-10 manufacturer or distributor, if the dealer has been notified of the
18-11 requirements prior to the time the claim arose, and if the
18-12 requirements were in effect at the time the claim arose. A
18-13 manufacturer or distributor may not audit a claim after the
18-14 expiration of two years following the submission of the claim
18-15 unless the manufacturer or distributor has reasonable grounds to
18-16 suspect that a claim was fraudulent. Notwithstanding the terms of
18-17 a franchise agreement] or provision of law in conflict with this
18-18 section, the dealer's delivery, preparation, and warranty
18-19 obligations as filed with the board shall constitute the dealer's
18-20 sole responsibility for product liability as between the dealer and
18-21 manufacturer or distributor, and, except for a loss caused by the
18-22 dealer's failure to adhere to these obligations, a loss caused by
18-23 the dealer's negligence or intentional misconduct, or a loss caused
18-24 by the dealer's modification of a product without manufacturer or
18-25 distributor authorization, the manufacturer or distributor shall
18-26 reimburse the dealer for all loss incurred by the dealer, including
18-27 legal fees, court costs, and damages, as a result of the dealer
19-1 having been named a party in a product liability action.
19-2 (12) Operate as a manufacturer, distributor, or
19-3 representative without a currently valid license from the board or
19-4 otherwise violate this Act or rules promulgated by the board
19-5 hereunder.
19-6 (13) Notwithstanding the terms of any franchise
19-7 agreement, to prevent or refuse to honor the succession to a
19-8 dealership by any legal heir or devisee under the will of a dealer
19-9 or under the laws of descent and distribution of this State unless
19-10 it is shown to the board, after notice and hearing, that the result
19-11 of such succession will be detrimental to the public interest and
19-12 to the representation of the manufacturer or distributor; provided,
19-13 however, nothing herein shall prevent a dealer, during his
19-14 lifetime, from designating any person as his successor dealer, by
19-15 written instrument filed with the manufacturer or distributor.
19-16 (14) Notwithstanding the terms of any franchise
19-17 agreement, require that a dealer pay or assume, directly or
19-18 indirectly, any part of any refund, rebate, discount, or other
19-19 financial adjustment made by the manufacturer, distributor, or
19-20 representative to, or in favor of, any customer of a dealer, unless
19-21 voluntarily agreed to by such dealer.
19-22 (15) Notwithstanding the terms of any franchise
19-23 agreement, deny or withhold approval of a written application to
19-24 relocate a franchise unless (A) the applicant has received written
19-25 notice of the denial or withholding of approval within 60 days
19-26 after receipt of the application containing information reasonably
19-27 necessary to enable the manufacturer or distributor to adequately
20-1 evaluate the application, and if (B) the applicant files a protest
20-2 with the board and the manufacturer or distributor establishes by a
20-3 preponderance of the evidence at a hearing called by the board that
20-4 the grounds for the denial or withholding of approval of the
20-5 relocation are reasonable.
20-6 (16) Notwithstanding the terms of any franchise
20-7 agreement, fail to pay to a dealer or any lienholder in accordance
20-8 with their respective interest after the termination of a
20-9 franchise:
20-10 (A) the dealer cost of each new motor vehicle in
20-11 the dealer's inventory with mileage of 6,000 miles or less, reduced
20-12 by the net discount value of each, where "net discount value" is
20-13 determined according to the following formula: net cost multiplied
20-14 by total mileage divided by 100,000, and where "net cost" equals
20-15 the dealer cost plus any charges by the manufacturer, distributor,
20-16 or representative for distribution, delivery, and taxes, less all
20-17 allowances paid to the dealer by the manufacturer, distributor, or
20-18 representative for new, unsold, undamaged, and complete motor
20-19 vehicles of current model year or one year prior model year in the
20-20 dealer's inventory, except that if a vehicle cannot be reduced by
20-21 the net discount value, the manufacturer or distributor shall pay
20-22 the dealer the net cost of the vehicle;
20-23 (B) the dealer cost of each new, unused,
20-24 undamaged, and unsold part or accessory if the part or accessory is
20-25 in the current parts catalogue and is still in the original,
20-26 resalable merchandising package and in unbroken lots, except that
20-27 in the case of sheet metal, a comparable substitute for the
21-1 original package may be used, and if the part or accessory was
21-2 purchased by the dealer either directly from the manufacturer or
21-3 distributor or from an outgoing authorized dealer as a part of the
21-4 dealer's initial inventory;
21-5 (C) the fair market value of each undamaged sign
21-6 owned by the dealer which bears a trademark or tradename used or
21-7 claimed by the manufacturer, distributor, or representative if the
21-8 sign was purchased from or purchased at the request of the
21-9 manufacturer, distributor, or representative;
21-10 (D) the fair market value of all special tools,
21-11 data processing equipment, and automotive service equipment owned
21-12 by the dealer which were recommended in writing and designated as
21-13 special tools and equipment and purchased from or purchased at the
21-14 request of the manufacturer, distributor, or representative, if the
21-15 tools and equipment are in usable and good condition except for
21-16 reasonable wear and tear;
21-17 (E) the cost of transporting, handling, packing,
21-18 storing, and loading of any property subject to repurchase under
21-19 this section;
21-20 (F) except as provided by this subdivision, any
21-21 sums due as provided by Paragraph (A) of this subdivision within 60
21-22 days after termination of a franchise and any sums due as provided
21-23 by Paragraphs (B) through (E) of this subdivision within 90 days
21-24 after termination of a franchise. As a condition of payment, the
21-25 dealer is to comply with reasonable requirements with respect to
21-26 the return of inventory as are set out in the terms of the
21-27 franchise agreement. A manufacturer or distributor shall reimburse
22-1 a dealer for the dealer's cost for storing any property covered by
22-2 this subdivision beginning 90 days following termination. A
22-3 manufacturer or distributor shall reimburse a dealer for the
22-4 dealer's cost of storing any property covered by this subdivision
22-5 before the expiration of 90 days from the date of termination if
22-6 the dealer notifies the manufacturer or distributor of the
22-7 commencement of storage charges within that period. On receipt of
22-8 notice of the commencement of storage charges, a manufacturer or
22-9 distributor may immediately take possession of the property in
22-10 question by repurchasing the property as provided by this
22-11 subdivision. A manufacturer, distributor, or representative who
22-12 fails to pay those sums within the prescribed time or at such time
22-13 as the dealer and lienholder, if any, proffer good title prior to
22-14 the prescribed time for payment, is liable to the dealer for:
22-15 (i) the greatest of dealer cost, fair
22-16 market value, or current price of the inventory;
22-17 (ii) interest on the amount due calculated
22-18 at the rate applicable to a judgment of a court; and
22-19 (iii) reasonable attorney's fees and
22-20 costs.
22-21 (17) Notwithstanding the terms of any franchise
22-22 agreement, change its distributor, its method of distribution of
22-23 its products in this state, or its business structure or ownership
22-24 in a manner that results in the termination or noncontinuance of a
22-25 franchise without good cause. The manufacturer, distributor, or
22-26 representative shall issue the same notice to the dealer and to the
22-27 board as is provided in Subdivisions (3)(A) and (B) of this section
23-1 and said same procedures shall apply to the parties.
23-2 (18) Notwithstanding the terms of any franchise
23-3 agreement, require a dealer to submit to arbitration on any issue
23-4 unless the dealer and the manufacturer, distributor, or
23-5 representative and their respective counsel agree to arbitrate
23-6 after a controversy arises. The arbitrator shall apply the
23-7 provisions of this Act in resolving the pertinent controversy.
23-8 Either party may appeal to the board a decision of an arbitrator on
23-9 the ground that the arbitrator failed to apply this Act.
23-10 (19) Notwithstanding the terms of any franchise
23-11 agreement, require that a dealer join, contribute to, or affiliate
23-12 with, directly or indirectly, any advertising association.
23-13 (20) Notwithstanding the terms of a franchise
23-14 agreement:
23-15 (A) require adherence to unreasonable sales or
23-16 service standards;
23-17 (B) directly or indirectly, discriminate against
23-18 a dealer or otherwise treat dealers differently as a result of a
23-19 formula or other calculation or process intended to gauge the
23-20 performance of a dealership;
23-21 (C) unreasonably require that a dealer purchase
23-22 special tools or equipment; or
23-23 (D) fail to compensate a dealer for all costs
23-24 incurred by the dealer as required by the manufacturer in complying
23-25 with the terms of a product recall by the manufacturer or
23-26 distributor, including the costs, if any, incurred by the dealer in
23-27 notifying vehicle owners of the existence of the recall.
24-1 (21) Discriminate unreasonably between or among
24-2 franchisees in the sale of a motor vehicle owned by the
24-3 manufacturer or distributor.
24-4 (22) Directly or indirectly, or through a subsidiary
24-5 or agent, require, as a condition for obtaining financing for a
24-6 motor vehicle, the purchaser of a vehicle to purchase any product
24-7 other than the motor vehicle from the manufacturer or distributor,
24-8 or from an entity owned or controlled by the manufacturer or
24-9 distributor.
24-10 (23) Directly or indirectly, or through a subsidiary
24-11 or agent, require, as a condition of its or its subsidiary's
24-12 agreement to provide financing for a motor vehicle, that any
24-13 insurance policy or service contract purchased by the motor vehicle
24-14 purchaser be purchased from a specific source.
24-15 (24) Compel a dealer through a financing subsidiary of
24-16 the manufacturer or distributor to agree to unreasonable operating
24-17 requirements or directly or indirectly to terminate a dealer
24-18 through the actions of a financing subsidiary of the manufacturer
24-19 or distributor. This subdivision does not limit the right of a
24-20 financing entity to engage in business practices in accordance with
24-21 the usage of trade in retail and wholesale motor vehicle financing.
24-22 (25) [Operate as a dealer except on a temporary basis
24-23 and only if:]
24-24 [(A) the dealership was previously owned by a
24-25 franchised dealer and is currently for sale at a reasonable price;
24-26 or]
24-27 [(B) the manufacturer, distributor, or
25-1 representative operates the dealership in a bona fide relationship
25-2 with a franchised dealer who is required to make a significant
25-3 investment in the dealership, subject to loss, and who reasonably
25-4 expects to acquire full ownership of the dealership under
25-5 reasonable terms and conditions.]
25-6 [(26)] Notwithstanding the terms of a franchise
25-7 agreement, deny or withhold approval of a dealer's application to
25-8 add a line-make or parts or products related to that line-make
25-9 unless, within 60 days of receipt of the dealer's written
25-10 application to add the line-make, the manufacturer or distributor
25-11 gives the dealer written notice of the denial or withholding of
25-12 approval. After receipt of notice, the dealer may file a protest
25-13 with the board. If the dealer files a protest as provided by this
25-14 subdivision, the board may uphold the manufacturer's or
25-15 distributor's decision to deny or withhold approval of the addition
25-16 of the line-make only if the manufacturer or distributor proves by
25-17 a preponderance of the evidence that the denial or withholding of
25-18 approval was reasonable. In determining whether or not the
25-19 manufacturer or distributor has met its burden to show that its
25-20 denial or withholding of approval is reasonable, the board shall
25-21 consider all existing circumstances, including, without limitation,
25-22 the following:
25-23 (A) the dealer's sales in relation to the sales
25-24 in the market;
25-25 (B) the dealer's investment and obligations;
25-26 (C) injury or benefit to the public [welfare];
25-27 (D) the adequacy of the dealer's sales and
26-1 service facilities, equipment, parts, and personnel in relation to
26-2 those of other dealers of new motor vehicles of the same line-make;
26-3 (E) whether warranties are being honored by the
26-4 dealer agreement;
26-5 (F) the parties' compliance with their franchise
26-6 agreement to the extent that the franchise agreement is not in
26-7 conflict with this Act;
26-8 (G) the enforceability of the franchise
26-9 agreement from a public policy standpoint, including without
26-10 limitation, issues of the reasonableness of the franchise
26-11 agreement's terms, oppression, adhesion, and the relative
26-12 bargaining power of the parties;
26-13 (H) whether the dealer complies with reasonable
26-14 capitalization requirements or will be able to comply with
26-15 reasonable capitalization requirements within a reasonable time;
26-16 (I) the harm, if any, to the manufacturer if the
26-17 denial or withholding of approval is not upheld; and
26-18 (J) the harm, if any, to the dealer if the
26-19 denial or withholding of approval is upheld.
26-20 (26) [(27)] Fail or refuse to offer to its same
26-21 line-make franchised dealers all models manufactured for that
26-22 line-make, or require a dealer to pay any extra fee, purchase
26-23 unreasonable advertising displays or other materials, or remodel,
26-24 renovate, or recondition the dealer's existing facilities as a
26-25 prerequisite to receiving a model or series of vehicles.
26-26 (27) [(28)] Require a dealer to compensate the
26-27 manufacturer or distributor for any court costs, attorney's fees,
27-1 or other expenses incurred in an administrative or civil proceeding
27-2 arising under this Act, except that this subdivision does not
27-3 prohibit a manufacturer and dealer from entering into an agreement
27-4 to share costs in a proceeding in which the dealer and manufacturer
27-5 have the same or similar interests.
27-6 SECTION 13. Section 6.01, Texas Motor Vehicle Commission
27-7 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
27-8 to read as follows:
27-9 Sec. 6.01. ADMINISTRATIVE [CIVIL] PENALTY. (a) In the
27-10 event the board [Commission] determines, after a proceeding
27-11 conducted in accordance with this Act and the rules of the board
27-12 [Commission], that any person is violating or has violated any
27-13 provision of this Act, any rule or order of the board [Commission]
27-14 issued pursuant to this Act, [or] Section 503.038(a),
27-15 Transportation Code, or Subchapter A, Chapter 728, Transportation
27-16 Code, the board [Commission] may levy an administrative [a civil]
27-17 penalty not to exceed $10,000.00 for each day of violation and for
27-18 each act of violation. Notwithstanding a law to the contrary, all
27-19 administrative [civil] penalties recovered under this Act shall be
27-20 deposited in the state treasury to the credit of the state highway
27-21 fund.
27-22 (b) In determining the amount of an administrative [a civil]
27-23 penalty levied under this Act, the board [Commission] shall
27-24 consider:
27-25 (1) the seriousness of the violation, including but
27-26 not limited to the nature, circumstances, extent, and gravity of
27-27 the prohibited acts, and the harm or potential harm created to the
28-1 safety of the public;
28-2 (2) the economic damage to the public caused by the
28-3 violation;
28-4 (3) the history of the previous violations;
28-5 (4) the amount necessary to deter future violations;
28-6 (5) efforts made to correct the violations; and
28-7 (6) any other matters that justice may require.
28-8 SECTION 14. Section 6.07(a), Texas Motor Vehicle Commission
28-9 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
28-10 to read as follows:
28-11 (a) In addition to the other powers and duties provided for
28-12 in this Act, the board [Commission] shall cause manufacturers,
28-13 converters, and distributors to perform the obligations imposed by
28-14 this section. For purposes of this section, the term "owner" means
28-15 a resident of this state who:
28-16 (1) purchased a vehicle from a licensee at retail and
28-17 is entitled to enforce the manufacturer's warranty issued for the
28-18 vehicle;
28-19 (2) is a [purchaser,] lessor or[,] lessee, other than
28-20 a sublessee, who purchased or leased the vehicle from a licensee;
28-21 or
28-22 (3) is the transferee or assignee of a person
28-23 described by Subdivision (1) or (2) of this subsection if the
28-24 transferee or assignee is a resident of this state and entitled to
28-25 enforce the manufacturer's warranty [the person so designated on
28-26 the certificate of title to a motor vehicle issued by the Texas
28-27 Department of Transportation, or an equivalent document issued by
29-1 the duly authorized agency of any other state, or any person to
29-2 whom such motor vehicle is legally transferred during the duration
29-3 of a manufacturer's or distributor's express warranty applicable to
29-4 such motor vehicle, and any other person entitled by the terms of
29-5 the manufacturer's, converter's, or distributor's express warranty
29-6 to enforce the obligations thereof].
29-7 SECTION 15. Section 7.01(f), Texas Motor Vehicle Commission
29-8 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
29-9 to read as follows:
29-10 (f) Appeal does [shall] not affect the enforcement of a
29-11 final board [Commission] order unless:
29-12 (1) its enforcement is enjoinable under Section 65.001
29-13 et seq., Civil Practice and Remedies Code, and under principles of
29-14 primary jurisdiction; or
29-15 (2) the board, in the interest of justice, suspends
29-16 the enforcement of a final order until the appeal is finally
29-17 determined.
29-18 SECTION 16. The Texas Motor Vehicle Commission Code (Article
29-19 4413(36), Vernon's Texas Civil Statutes) is amended by adding
29-20 Subchapter H to read as follows:
29-21 SUBCHAPTER H. MISCELLANEOUS PROVISIONS
29-22 Sec. 8.01. WARRANTY REIMBURSEMENT. (a) A manufacturer or
29-23 distributor shall maintain on file with the board a copy of the
29-24 current requirements imposed by the manufacturer or distributor on
29-25 its dealers with regard to a dealer's:
29-26 (1) duties under the manufacturer's or distributor's
29-27 warranty; and
30-1 (2) vehicle delivery and preparation obligations.
30-2 (b) A requirement imposed on a dealer under Subsection (a)
30-3 of this section is unenforceable if it is:
30-4 (1) unreasonable as determined by board rule; or
30-5 (2) not filed in compliance with Subsection (a) of
30-6 this section.
30-7 (c) A manufacturer or distributor shall:
30-8 (1) fairly and adequately compensate its dealers for
30-9 all warranty work, including labor, parts, and other expenses
30-10 necessarily incurred by the dealer in the performance of the
30-11 warranty work;
30-12 (2) pay or reimburse a dealer for warranty work an
30-13 amount at least equal to the amount the dealer charges retail
30-14 customers for nonwarranty work similar to the work performed under
30-15 the warranty; and
30-16 (3) pay a dealer's claim for reimbursement for
30-17 warranty work or dealer preparation and delivery not later than the
30-18 30th day after the date the claim is approved.
30-19 (d) A reimbursement claim under Subsection (c)(3) of this
30-20 section that is not disapproved on or before the 30th day after the
30-21 date the claim is submitted is considered to be approved.
30-22 (e) If a reimbursement claim is disapproved, the
30-23 manufacturer or distributor shall provide the dealer, by written
30-24 notice, the reasons for the disapproval.
30-25 (f) A manufacturer or distributor may not attempt to recover
30-26 money paid to the dealer to satisfy an approved claim unless the
30-27 manufacturer or distributor has evidence that:
31-1 (1) the claim was false or fraudulent;
31-2 (2) the repair work was improperly performed or
31-3 unnecessary to correct a defective condition; or
31-4 (3) the dealer who made the claim failed to
31-5 substantiate the claim in the manner required by the manufacturer
31-6 or distributor if the requirements:
31-7 (A) were on file with the board at the time the
31-8 claim was filed; and
31-9 (B) were reasonable as determined by board rule.
31-10 (g) A manufacturer or distributor may not:
31-11 (1) audit a claim filed under this section after the
31-12 first anniversary of the date the claim was submitted unless the
31-13 manufacturer or distributor has reasonable grounds to believe the
31-14 claim was fraudulent; or
31-15 (2) require as a condition for the reimbursement of a
31-16 claim that a dealer file a statement of the actual time of the
31-17 labor involved unless the actual time of the labor is the basis for
31-18 reimbursement.
31-19 Sec. 8.02. MANUFACTURER OR DISTRIBUTOR INCENTIVE PROGRAMS.
31-20 (a) In this section, "incentive program" means a temporary program
31-21 offered by a manufacturer or distributor that provides a monetary
31-22 reward or other thing of value to a dealer, dealer's employee, or
31-23 dealer's customer for the attainment of a sales goal or other
31-24 objective within a stated time. This subsection does not permit a
31-25 program otherwise prohibited by this Act.
31-26 (b) A manufacturer or distributor must file with the board a
31-27 copy of an incentive program's rules and procedures and the duties
32-1 of the dealer. The copy must be filed within a reasonable time
32-2 after the program is initiated and is not a public record except to
32-3 the extent that it is introduced at a hearing.
32-4 (c) A manufacturer or distributor may not recoup money
32-5 awarded or the monetary value of an award to a dealer unless the
32-6 manufacturer or distributor can show that:
32-7 (1) information filed by the dealer contained a
32-8 material mistake that:
32-9 (A) was not discovered before the date the award
32-10 was made; and
32-11 (B) caused the manufacturer or distributor to
32-12 award the dealer; and
32-13 (2) the manufacturer or distributor took reasonable
32-14 care to discover material mistakes before making the award.
32-15 (d) A manufacturer or distributor may not audit the records
32-16 of a dealer after the first anniversary of the date on which the
32-17 program ends to determine compliance with the incentive program
32-18 unless the manufacturer or distributor has reasonable grounds to
32-19 believe the dealer committed fraud. A clerical error may not be
32-20 considered to be fraud under this subsection.
32-21 Sec. 8.03. MANUFACTURER OWNERSHIP OF DEALERSHIP. (a) In
32-22 this section, "agent" means a person who is affiliated with a
32-23 manufacturer, distributor, or representative or who directly or
32-24 through an intermediary is controlled by or under common control
32-25 with a manufacturer, distributor, or representative. An agent is
32-26 considered to be controlled by a manufacturer, distributor, or
32-27 representative if the manufacturer, distributor, or representative
33-1 has the direct or indirect authority under law or an agreement to
33-2 direct or influence the agent's management and policies.
33-3 (b) Except as provided by this section, a manufacturer,
33-4 distributor, representative, or agent may not directly or
33-5 indirectly:
33-6 (1) own an interest in a dealer or dealership;
33-7 (2) operate or control a dealer or dealership; or
33-8 (3) act as a dealer.
33-9 (c) A manufacturer, distributor, representative, or agent
33-10 may own an interest in a franchised dealer or control a dealership
33-11 for not more than one year from the date the person acquires the
33-12 dealership if:
33-13 (1) the manufacturer, distributor, representative, or
33-14 agent acquired the dealership from a franchised dealer; and
33-15 (2) the dealership is offered for sale by the
33-16 manufacturer, distributor, representative, or agent at a
33-17 competitive price and under reasonable terms.
33-18 (d) A manufacturer, distributor, representative, or agent
33-19 may temporarily own an interest in a dealership if:
33-20 (1) the primary purpose of the ownership is for the
33-21 purpose of broadening opportunities for persons who:
33-22 (A) are members of a historically
33-23 underrepresented group; or
33-24 (B) are unable to purchase a dealership without
33-25 financial assistance; and
33-26 (2) the participation of the manufacturer,
33-27 distributor, representative, or agent is a bona fide relationship
34-1 with a franchised dealer who:
34-2 (A) has made a significant investment in the
34-3 dealership that is subject to loss;
34-4 (B) has an ownership interest in the dealership;
34-5 and
34-6 (C) operates the dealership under a reasonable
34-7 agreement that provides for the full ownership of the dealership
34-8 within a reasonable time and under reasonable terms.
34-9 SECTION 17. Section 2.02, Texas Motor Vehicle Commission
34-10 Code (Article 4413(36), Vernon's Texas Civil Statutes), as amended
34-11 by this Act, does not affect the entitlement of a member of the
34-12 Motor Vehicle Board of the Texas Department of Transportation who
34-13 is serving on the board immediately before the effective date of
34-14 this Act to continue to serve on the board for the remainder of the
34-15 member's term or to serve in a holdover capacity until a successor
34-16 is appointed and takes office.
34-17 SECTION 18. Section 3.08(g), Texas Motor Vehicle Commission
34-18 Code (Article 4413(36), Vernon's Texas Civil Statutes), as amended
34-19 by this Act, applies only to a final decision or order that is
34-20 issued on or after the effective date of this Act. A final
34-21 decision or order that is issued before the effective date of this
34-22 Act is governed by the law in effect on the day the final decision
34-23 or order was issued, and the former law is continued in effect for
34-24 that purpose.
34-25 SECTION 19. Section 6.07(a), Texas Motor Vehicle Commission
34-26 Code (Article 4413(36), Vernon's Texas Civil Statutes), as amended
34-27 by this Act, applies only to a sale or lease that occurs on or
35-1 after the effective date of this Act. A sale or lease that occurs
35-2 before the effective date of this Act is governed by the law in
35-3 effect on the date the sale or lease occurred, and the former law
35-4 is continued in effect for that purpose.
35-5 SECTION 20. Section 8.03, Texas Motor Vehicle Commission
35-6 Code (Article 4413(36), Vernon's Texas Civil Statutes), as added by
35-7 this Act, applies only to an ownership interest acquired on or
35-8 after the effective date of this Act. An ownership interest
35-9 acquired before the effective date of this Act is governed by the
35-10 law in effect on the date the ownership interest was acquired, and
35-11 the former law is continued in effect for that purpose.
35-12 SECTION 21. The importance of this legislation and the
35-13 crowded condition of the calendars in both houses create an
35-14 emergency and an imperative public necessity that the
35-15 constitutional rule requiring bills to be read on three several
35-16 days in each house be suspended, and this rule is hereby suspended,
35-17 and that this Act take effect and be in force from and after its
35-18 passage, and it is so enacted.